Why Weebly Is The Warp Drive Of Website Building

Weebly is more than just a well-established name in website building. Founded in 2007, Weebly was the first to offer easy-to-use website building tools for anyone from the amateur to long-time professionals, revolutionizing what can be done and by whom. They’ve been wildly successful from day one, with over 30 million people starting websites using Weebly.

But they haven’t stopped there: David Rusenko and his partners Dan Veltri and Chris Fanini kept building, and have extended their reach into a full-service platform that provides not only organization and design, but ecommerce, a new robust app center for third party plugins, analytics, cloud hosting, and most recently, completely new mobile apps for site editing on the go.

I spoke with Rusenko about how he built the company from the ground up, and what’s next for Weebly.

How did you come up with the idea for the idea for the company?

In early 2006, Dan Chris and I were undergraduates at Penn State. Part of the project for a class we were taking was to come up with an app. I was sitting around thinking about things that we could improve, and I remember that I had a friend who had to create website for her astronomy class. People forget what things were like back then. If you didn’t know how to code, you had to use Front Page or Dreamweaver. I was watching her struggle through that, trying to use links and menus, and uploading vsftpd, and we thought, “This is an area where we can really make something that’s better than what’s out there.”

How did it come together as a business?

We were working every waking hour that summer when we weren’t studying for our internship in New York. We applied for Y Combinator in fall of 2006 -- just as the program was becoming more prominent -- but it certainly wasn’t extremely well known back then. We interviewed, got accepted, then skipped out of school and moved out to San Francisco in January of 2007. We went through the program and ended up raising a 650K round from Mike Maples, Steve Anderson and a bunch of angels.

How did your family react when you said, “Hey, I’m leaving college and doing this?”

When I submitted Weebly for YC, I was up late reading Slashdot (which tells you just how long ago that was), and the deadline to submit was midnight PT. So, at 1 A.M. ET, I start thinking this would be really cool. But I didn’t have time to call Dan and Chris and ask them if they wanted to drop out of college. The application had a question about who would join the team full time, and I took my best guess. I figured Chris would and Dan wouldn’t. I submitted the app, with less than an hour to go on the deadline, and the next day I called Chris up and said, “Hey Chris, want to drop out of school and move to San Francisco?” He answers, “Absolutely, yes, let’s do this.” I called Dan with the same question and he said, “Sounds cool, let me call my parents and talk to them, I’ll call you back.” An hour later he called me back and said he’s in. All of our parents were very excited for us.

When you went to YC, what stage had you reached?

We had just barely launched publicly, but it was more of an Alpha stage. It was early in November and through a set of circumstances, Michael Arrington ended up writing about us in TechCrunch the same day we had an interview. We were the furthest along startup that got into YC. By the time we started the program, we had 2000 users; we were actually launched and had something out there.

When you say that you had 2000 users, were they paying users?

It wasn’t until 2008 that anyone could pay us any money. For the first 18 months it was free. We would actually have people email us all the time in that initial period and say, “I want to pay you, here’s my credit card number,” and it just wasn’t a possibility.

Tell me about the process of raising.

Well, we were talking to investors and the conversation seemed to be going well. It was post-demo day, but we got to a point where we had less than $100 in our bank account. At the time, the investment from YC was $20,000. We had three guys in a two-bedroom apartment in North Beach, and we made that money last four months. If you look at the rate of expenses, we were all living on about $20k a year -- pretty cheaply. We paid for rent and an occasional night out at the bar, but otherwise nothing fancy and a lot of Costco trips.

So, we got to this point right before we raised where we had less than $100 in the account, and it was a little bit of a “hold your breath” type moment. I remember that the room wasn’t that big for our demo pitch, maybe 50 or 60 investors, and there were 12 companies in our YC batch. Our pitch that day was rebuilding Benchmark’s website in five minutes, in front of everyone. Every angel we pitched, we would rebuild their website in five minutes as well, just to show how easy it was.

One other interesting tidbit was that Stephen Levy was writing his article on YC, this in-depth feature for Newsweek, which was one of the first times YC got major press. He asked us if he could be a fly on the wall at our pitch and promised he would keep it confidential, but use it to color his story. It was definitely interesting to call up the investor and ask them, “Do you mind if a reporter tags along?” Ultimately, I don’t think they cared too much.

Once you raised, what was your next step?

Even after we raised, we didn’t pay ourselves any salary for awhile. We still kept on very minimal burn. It was business as usual; we spent every waking hour proofing products. We would work until we were tired, then sleep until we woke up. Really, it meant we would work until about 8 or 9 AM. I met my wife around the same time, while she was attending law school, and we had a one or two-hour overlap in the morning where I could talk to her, when I was going to bed and she was waking up.

We ended up hiring our first employee and getting our first office in summer of 2008, a full year later. Interestingly, right around that time Lehman Brothers collapsed and the financial crisis happened in August of 2008. It was actually a great time to be hiring, but not a fantastic time to be signing a long-term lease on an office.

We got to the point where we figured we needed to raise another round. We got a term sheet from one of our existing investors, but we didn’t feel like it really valued the company as highly as it should. We figured we would just push through to profitability. From December 2008 we became cash flow positive and have been a profitable company ever since.

How did you make the move from a free to pay? That’s always a big step.

We started charging in June of 2008. That was the first time anyone could pay us any money, at all. December to January was a bit tight, and we were doing our cash balance by the day -- which bills do we have to pay? Which bills are ones where someone just calls and yells at us, and which bills are ones that if we don’t pay them, our service will get shut off? But 18 months ago we raised 35 million dollars, and we haven’t spent any of it yet.

Why did you raise the money if you’re cash flow positive?

We certainly intend to invest it, but I think we’re diligent, deliberate, and thoughtful about how we want to invest it. As a company we’re very clear that every dollar we spend, we earned. We don’t just want to be wasteful and just throw it around and spend it because it’s there. We want it to be a good use and a great investment. We think there will be lots of opportunities to make those investments, but because the business is growing so much without spending, we haven’t had to dip into that yet.

You’ve just done a new product release. What’s the process you go through to do that?

It was a really big release called Carbon. We have a lot of customers, so obviously making sure that goes smoothly is really important to us. As far as our product launch cycle goes, it’s very detailed and we have checkpoints that we try for. There’s a period where the whole company comes together for a launch party with a Q and A session, and everyone goes downstairs and just starts banging on the new features and testing them out, finding all the bugs.

We also go through a long period where we are only testing to make sure the quality is there. During the actual release, we set up three different shifts for engineering teams, with the goal of having it ready to go at midnight. There was one shift that came in at 9 PM making sure that it was ready to go out the door, another that came in at 5 or 6 AM to deal with little issues, as there always will be, to fix those immediately. The last relief shift came in at 11 AM to have their eyes on the support queue throughout the day to make sure that anything else that comes up is dealt with.

How did that process help you?

Carbon was something that was a long time in the making, just monumental. We call it the third generation because truly, it is. We operate on a continuous improvement release cycle, but this one just had so much altogether.

The primary function was, first and foremost, the mobile apps. We launched a new set of apps that let you create and edit your site, and manage and edit your store, all from your phone as well. We’re the only platform out there that is not a sit-at-your-desk experience. You can be on the go and make small changes with your phone or tablet, and of course from your desktop as well. That was our number one requested feature, and it was massive. The phone apps are a huge partner usage, and that is very unique about Weebly.

The second most requested feature was the app center and extending functionality in terms of social integrations, customer service, email marketing, and things like that. There are so many technological pieces of the puzzle and things you need to do when you’re starting a company, but how do you bring them together? It’s almost like someone smashed the plate. The pieces are all there, but they have to get back together somehow. Our vision is to be the glue that brings those pieces back together, so everything in inter-operable and works seamlessly together. With Weebly, you just have one technology platform that manages all aspects, and helps you manage your business.

Are you going to build those out? Increase integration into the marketplace? What’s your plan?

Yes. All of the above. Some things we will build, like ecommerce for example; we have an absolutely massive ecommerce platform. It’s a major part of the business, and something we’re not necessarily known for. We probably haven’t done a good job messaging how we’re almost more an ecommerce platform than anything else.

But other things we’ll integrate, for example, Shippo. Shippo really just simplifies fulfillment. So when you’re selling physical goods, it’s an absolute nightmare to decide whether it’s UPS, USPS, FedEx, how do you ship it, and so on. But people can, in one click, integrate Shippo and the next day save themselves two hours of headaches on their fulfillment needs. That’s really cool. We launched an all-new editor and made it even simpler than it was before. We also launched a brand new theme engine and new themes that I think are really fantastic.

What other businesses do you see in the Bay Area that are doing really well? Who do you benchmark yourself against?

We’re a very early user of Zenefits, which just been amazing. They’re just kicking ass.

In terms of how we benchmark ourselves, I think that we really are focusing on the decentralization of work. It’s been called many names: the sharing economy, the gig economy, the line between 10-99 and full time and freelancer. All of that is getting very blurry. One of the Twitter sound bites I hear is, “The death of the traditional 9-5.” Certainly traditional hours seem to be disappearing. In the process, as more people are taking charge of their own value that they add to the world, one of the biggest needs for people is technology that enables them to do all of that.

Our vision is to be the thing that powers these entrepreneurs and small businesses and individuals. That’s effectively a huge step we took with Carbon and the direction we’re going to continue going. A lot of people just don’t grasp how massive the potential is if we could be the platform for all of these entrepreneurs.

Murray Newlands FRSA is an entrepreneur, business advisor and speaker. Newlands is the founder of www.chattypeople.com and chatbot company. Newlands is also an adviser to the Draper Nexus Network of Things Fund that invests in IOT companies. He gives practice advice from th...